This market is weird. Here we are in June and Summer is here! The Lawrence housing market continues the odd story it's been telling us in 2023. While sales are WAY down, prices continue to rise. To sum it up as best I can, I'd say this is the trickiest market to navigate for BOTH buyers and sellers that we've seen in a while.
What do I mean by that? Well, there's certainly fewer buyers in the market today than a year ago. Rising rates and prices together have driven some out of the market. So, there's less competition. That's good, right? However while there is less competition for any one house, prices continue to rise. While we're not seeing huge increases that have driven the market these past 2/3 years, any continued increases are built upon those past surges. Add in rising rates and the affordability picture isn't exactly a pretty one.
What about sellers? It's still a good market for sellers, overall. But many sellers seem to be leaning into a tendency to overprice their home based on news headlines. In some cases, buyers aren't falling for it. While prices continue to rise, those increases are much more modest in 2023. So far this year prices are up on average about 2.9%. And the buyers that remain in the market are good, qualified buyers that know this is still a Seller's Market. It's just not the crazy feeding-frenzy some sellers might be hoping for.
All of the stats that follow are sourced from the Lawrence MLS. What follows is a look at some numbers through the month of May 2023 within the city limits of Lawrence:
Month-over-Month
- May home sales increased a whopping 79% from the previous month (118 vs 66)
- Average price increased by 2% in May vs. the previous month
- Median Days-on-Market was flat compared in homes closed in May at 4 DOM
- 109 homes were listed in May, an decrease from 144 listed in April
- List-Price-to-Sales-Price Ratio for April was 101.4%, up from 100.4%
Year-over-Year
- Home sales were down 13% in May '23 vs May '22, a drop of 18 homes sold
- Average Price is up YoY at $357.5K
- Dollar Volume was down 11.5% vs May '22 for a total of $42.2M in the month
- The 109 homes listed last month was a decrease from 169 listed in May last year
YTD
- Home sales are down 27% for the year through May (333 vs 456)
- Average price so far in 2023 is up 2.9% to $336K vs the same period last year
- Median DOM is roughly flat vs a year ago (3 vs. 4 DOM)
- Total Homes Listed this year equals 481; a decline of 21.9% compared to 2022
- Total Dollar Volume in 2023 is down 24.8%; At the end of May last year the Lawrence market totaled $148.9M and so far this year we're sitting at $111.9M
Active Properties
- There are 82 "Active" properties in Lawrence as of this writing
- There are 120 properties currently listed as "Under Contract." This is a decrease of 16.7% since my last market update
As we near the halfway point of the year, it's pretty clear that the above figures presents a very mixed-bag. However, if one prefers to remain optimistic (and I count myself among this contingent!) then there good signs. If you're a seller, time on market is still low and prices are still up. If you're a buyer, there's less competition than in previous years. If you're able and willing to afford the current pricing and rate environment, you're likely to find a new home!
If you're a seller, you're likely only moving if there's a need to. Luckily for buyers, there are always people needing to move for jobs or changing family situations. Because rates continue to rise, any home owner who bought or refinanced with an interest rate in the 2's and 3's is unlikely to just get up and move. Housing inventory remains low.
Back in January I predicted that this year there would be fewer than 1,000 homes sold inside Lawrence. At our current rate, even if things improve substantially, we're well on pace to sell fewer than 900! I actually believe we'll beat 900 homes sold by the end of the year, but I also still believe my original prediction. 2023 will be the first year since the Great Recession that Lawrence has sold so few houses.
This June market update is the last of the first half of 2023. Next month we'll be able to take a look at how the first half of the year went and what I'm predicting for the second half. With the debt ceiling deal reached, my hope is that we see no more rate hikes and a smoother transition out of the busy season into a steady late-Summer/early Fall Market.
Stay tuned to R+K Real Estate for great new content, updates, advice, opinions and more in 2022. We plan to continue our advance of transparency, consumer advocacy, and empowering our clients with alternate business models designed to provide high levels or real estate service with drastically reduced commissions!
-Ryan Desch, Broker/Owner R+K Real Estate Solutions
